By Nermeen Nabil Khear TLDR
- Backpack announced acquisition of FTX EU on January 8, 2025
- FTX bankruptcy estate claims the sale was unauthorized
- Backpack says Cyprus regulator approved the purchase in December 2024
- Former FTX/Alameda employees founded Backpack
- Dispute centers around authority to distribute funds to FTX EU creditors
The FTX bankruptcy estate has challenged the validity of crypto exchange Backpack’s announced acquisition of FTX EU, creating uncertainty over the future of the European arm of the collapsed crypto exchange.
On January 8, 2025, Backpack, a cryptocurrency exchange and wallet provider, announced its acquisition of FTX EU. The company, founded by former FTX and Alameda Research employees, stated that the Cyprus regulator had approved the purchase in December 2024.
Hours after the announcement, the FTX bankruptcy estate issued a strong rebuttal, stating that the sale was unauthorized and occurred without their knowledge or involvement. The estate emphasized that Backpack has no authority to distribute funds to FTX customers or other creditors.
The dispute highlights the complex nature of FTX’s bankruptcy proceedings, which began in November 2022 following the exchange’s spectacular collapse. The bankruptcy estate maintains strict control over all FTX assets and operations through U.S. Bankruptcy Court oversight.
Backpack’s announcement included plans to operate a regulated crypto derivatives service using licenses acquired through the purchase. The company also outlined intentions to compensate FTX EU creditors, though specific details about the compensation structure were not disclosed.
Dispute
The Cyprus Securities and Exchange Commission’s role in the situation remains unclear. While Backpack claims to have received regulatory approval, the FTX bankruptcy estate’s statement suggests that such approval would not override U.S. bankruptcy court jurisdiction.
The controversy raises questions about the jurisdiction and authority over FTX’s international subsidiaries. FTX EU operated under Cypriot regulations before the exchange’s collapse, serving European customers through its licensed entity.
The timing of the dispute comes as the broader FTX bankruptcy proceedings continue in Delaware. The estate has been working to recover assets and develop plans for creditor compensation through court-approved processes.
Backpack, launched in 2024, has positioned itself as a new player in the cryptocurrency exchange market. The company’s leadership includes individuals who previously worked at FTX and Alameda Research before the exchange’s collapse.
The disputed acquisition announcement caused confusion among former FTX EU customers, who have been waiting for clarity on the status of their funds since November 2022. The FTX bankruptcy estate maintains that all claims must be processed through official channels.
The estate emphasized that any unauthorized attempts to distribute assets could interfere with the court-supervised process designed to ensure fair treatment of all creditors across FTX’s global operations.
Financial details of the purported acquisition were not disclosed in Backpack’s announcement. The company has not publicly responded to the bankruptcy estate’s statement as of January 9, 2025.
The FTX bankruptcy estate continues to work with legal teams across multiple jurisdictions to resolve complex issues related to the exchange’s international operations and assets.
Current estimates indicate that FTX owes more than $8 billion to creditors worldwide, with European customers representing a portion of those claims.
The dispute over FTX EU’s sale remains active, with both parties maintaining their positions regarding the legitimacy of the transaction as of January 9, 2025.
The post “Unauthorized Sale” FTX Bankruptcy Estate Disputes Backpack’s Acquisition of FTX EU appeared first on Blockonomi.
This articles is written by : Nermeen Nabil Khear Abdelmalak
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